- Bloomberg reported all was not well with BitFinex and Noble Bank
- HSBC appears to have withdrawn, living BitFinex without a way to accept deposits
- Users have expressed dismay in the recent past regarding delays in withdrawals
Information attributed to Block’s sources shows that the BitFinex Exchange has with immediate effect suspended all fiat currency deposits but expects things to go back to normal within a week. This may be related to ongoing speculation about the exchange’s financial stability and banking relationships which forced the company to declare it was not insolvent last weekend. The company said in a post:
“How any rational party can claim insolvency when the opposite is there for all to see is interesting and, once again, perhaps indicative of a targeted campaign based on nothing but fiction.”
Rumors that all was not well with BitFinex emerged on October 2nd 2018, when Bloomberg reported that Puerto Rico’s Noble Bank, which had been associated with the cryptocurrency exchange, was looking for a buyer at a bargain-basement price.
However, according to The Block, BitFinex was already banking with HSBC through a third-party account belonging to Global Trading Solutions. Since this was a private account, questions have emerged whether HSBC knows BitFinex was banking with them. Sources now show that the private account has ceased functioning and, as a result, BitFinex doesn’t have an active method and all USD, EUR, JPY, and GBP deposits are paused.
Amid all the speculation, BitMex Research stated it believes that BitFinex exchange had already withdrawn their funds from Noble Bank, causing the sale and that it was already banking somewhere else. Later that week The Block’s Larry Cermak stated in a Tweet that BitFinex was possibly banking with HSBC using a third-party account belonging to Global Trading Solutions, a well-known longstanding partner of the exchange, but not possibly HSBC.
‘Complications continue to exist’
The speculation in the crypto community about BitFinex’ precarious situation is that after the spotlight was shone on the relationship between the exchange and Global Trading Solutions, HSBC could have pulled the rug under the exchange’s feet, leaving them without a way to accept fiat deposits. Users have reported long delays in the recent past regarding fiat withdrawals from the exchange and a source of much anxiety among them. Commenting about the delays amidst the talk of insolvency, the company’s blog post stated:
“Complications continue to exist for us in the domain of fiat transactions, as they do for most cryptocurrency-related organizations. However, we continue to do our utmost to minimize any waiting times associated with fiat deposits and withdrawals.”
The cryptocurrency market has experienced a significant face-off this Thursday and questions have arisen whether it is in any way related to opaque operations at BitFinex.